SAA has confirmed its business continuity in a statement after the government clarified that the airline would not be shut down or sold.
The airline said: “SAA’s {turnaround} strategy implementation is on track and there are ‘green shoots’ that indicate positive results on initiatives already implemented, particularly in the airline’s route network. This follows the implementation of capacity adjustment in the domestic market and network optimization in the regional and international markets.”
The airline added that while there was more work to be done to implement the strategy, it was encouraged by the progress it had made thus far.
SAA’s statement was issued in response to Finance Minister Tito Mboweni’s assertion that the airline should be shut down. According to Business Day, on November 1 the Minister told investors at an event in New York: “[SAA] is loss-making, it’s unlikely to sort out the situation, in my view we should close it down… It is unlikely that you are going to find any private-sector equity partner who will come join this asset.”
President Cyril Ramaphosa has since told Parliament that the government was still considering the possibility of an equity partner for SAA.
The Free Market Foundation (an independent public benefit organisation) came out in support of the Finance Minister, stating that subsidising SAA “harms the poorest of the poor”, while the SA Transport and Allied Workers Union opposed the Minister, calling his statement irresponsible and pointing out that closing SAA would leave 8 000 people jobless.
On November 5, Minister of Public Enterprises, Pravin Gordhan, said that while the airline would continue to operate, there was heightened expectation for SAA to show more commitment and urgency to restoring itself financially and operationally. He indicated that the public were losing patience with SAA and urged all at the airline to work together with government to prove that it could be turned into a good business again.
In its statement, SAA confirmed that it would take three years to bring the company to a break-even position.
